Indian rice exporters urge to extend export ban deadline to avoid losses

by Pankaj Yadav

NEW DELHI, Sept. 27 (Xinhua) -- India's rice exporters are a disgruntled lot these days as their stocks are lying in queue at several ports, as uncertainty looms large as to whether they will be able to send their consignments amid a government ban on rice export.

The exporters are of the opinion that the federal government should have given them ample time, allowing the export of those consignments which had already been booked from the agriculture fields and were lying in warehouses for shipment.

Senior Executive Director of All India Rice Exporters Association Vinod Kaul said that the estimated losses to be suffered by rice exporters due to the export ban is around 60 billion Indian Rupees (736 million U.S. dollars).

The ban that took effect on Sept. 9 on rice exports, particularly broken rice, is intended to address a shortage in the domestic market as less rice production is expected in the coming season.

Initially the federal government had given the deadline of Sept. 15 for clearing all stocks of rice lying at the ports for export. On Sept. 21 the deadline was extended till the month's end.

Rice exporters are of the view that the deadline should be further extended so that all the stocks lying at ports or in warehouses would be loaded onto vessels.

Incessant rains in certain areas in the country this year, along with a lack of rains in some other areas, has led to a decrease in the sowing of rice crops. It is expected that the rice yield, particularly the broken rice output, will reduce, leading to a possible scarcity in domestic markets.

Preliminary estimates indicate that rice would not be sown in nearly 13 percent of the paddy fields. "Area sown under rice was 30.98 million hectares as compared to 35.36 million hectares of the corresponding period of last year," the Crop Weather Watch Group (CWWG) under the federal agriculture ministry reported at its meeting held on Aug. 12.

Official data showed India's broken rice exports increased by more than 43 times in the past four years. Prices of broken rice have risen significantly in the current year, and are expected to continue the uptrend amid the likelihood of a 6 percent shortfall in rice production this season in India.

Kaul said consignments of around 3.9 million tonnes of broken rice had already been procured by exporters, and that most stocks were now lying at ports or in warehouses, including private warehouses.

He further said that shipping bills in respect of most of these stocks had already been made, and the ban was imposed before they could be handed over to the customs department for export.

According to Kaul, the whole process of procurement from farmers to exporters takes around two to four months. "This sudden ban on broken rice exports has put the exporters in a difficult situation. They are bound to suffer huge losses if the deadline of exporting (till Sept. 30) is not extended further. We have approached the Indian government to consider our request for extension of the deadline. The response is awaited," he said.

Denying a possible shortage of rice in domestic markets, Narindra Miglani, a leading rice exporter in the northern state of Haryana, said that fresh crops of rice will be available soon, and the output could be sufficient to meet domestic demands.

"We had procured stocks of rice for exports as per our contracts with importers overseas. Now, we have to return them back to the commission agents or the farmers. In such a situation we have no option but to compensate for their losses from our pockets. We can't leave them stranded. Hence, we, the exporters, are the net sufferers," he said.

Date: 27-Sep-2022